How To Prioritize Your eCommerce Technology Investments
2011 is in the books, and I certainly hope your business in 2011 reflected the macro trends favoring online and mobile commerce. But as the calendar rolls over and we (quickly) fire back up after the holidays it is time to look at 2012’s plans and ensure we are laying the foundations for a successful year and beyond. But that begs the question of how best to manage the prioritization of technology investments in an environment of increased budget, and increased visibility. Some of you may be done with this, but many of you are still in the midst of making your decisions. As you complete your prioritization of projects for 2012, some things to keep in mind:
· Preparation makes the decisions much easier. Come to the table to make the decisions with your team armed with some essential preparation including your annual business plan with your key performance indicator (KPI) improvement goals, your customer experience improvement needs identified, your voice of the customer and social listening data, your marketing calendar, and your touchpoints (sites/digital channels) development capacity plan. Each project candidate should have a 2 page summary with a description, and an outline of the customer benefits, operations benefits, project KPI goals, one and three year ROI, and preliminary scope estimate laid out in an easy to digest format. Skip the PowerPoint and make sure it is written down in a sharable way, with someone responsible for making sure these are complete and thorough before they are considered. The key stakeholders should have a few days to review these prior to your prioritization session. These summaries then become the project charters as projects kick-off with the scope estimates becoming the budget for a project. That helps you manage the scope of projects throughout the process from here.
· Your prioritization process must be simple, clear, and decisive. Clearly identify THE decision maker – often the eBusiness leader, or maybe even the CEO – and the key stakeholders whose teams and goals may be most directly impacted and whose input may be useful to the decision maker. Understand how many projects can actually be approved in the development period (for example, now until November) by having a capacity plan for all the resources involved – both internal and external – and focus on filling the slots with the highest priority projects. It is not a sequential list, since only a few large projects can be accomplished. In a given year (and of course depending on the size and organization model of the design and development teams) this will typically be three large projects, six medium projects, and six small projects that you can actually resource and execute. It is not really a matter of money; it is a matter of your most important resources being available to support the design, user testing, development, and system testing each of these projects in a sustainable, disciplined way. If you work with an outside development or vendor team (for one or all the projects) do not underestimate the impact on your internal resources in the design, integration, and business process change management aspects of the projects.
· The ongoing management of your project portfolio must be both disciplined and flexible. Once a project launches, remain committed to its execution and avoid randomizing your design and development teams. If a project ends up being larger than you budgeted once it moves into design (resources, time, or money), you will have to decide at that point to take other projects off the queue or reduce the scope of the project at hand. Importantly, it is a trickledown effect if you increase the scope on a project and you may risk later projects in the queue which may have an even greater impact on your business results. As the year progresses, the slots in the development calendar that come up are certainly available to have a different project slotted in. You can use the same process to consider alternatives which may be opportunistic or reflect our changing business priorities.
What did I miss? What works for you? I look forward to your comments.